Lee Jae-myung: "Basic Income Does Not Conflict with Universal Employment Insurance"

Gyeonggi Province Governor Lee Jae-myung expressed his view that basic income does not conflict with universal employment insurance.

Governor Lee stated through his SNS on the 23rd, "Both universal employment insurance, which is a short-term remedy for temporary unemployment on the premise of job retention, and basic income, which is a long-term fundamental solution for the Fourth Industrial Revolution era when jobs disappear, are necessary. These two are neither conflicting nor mutually exclusive. While it is difficult to secure funding for universal employment insurance where taxpayers and beneficiaries are separated through tax increases, funding for basic income where taxpayers and beneficiaries coincide can be secured through tax increases," he said.

In doing so, the governor divided his views on basic income and tax increases into six categories and posted them.

Below is the full text of the governor's SNS post.

<Tax Increases and Basic Income...We Must Be Honest About the Truth.>

1. Basic income is a welfare-oriented economic policy premised on tax increases.

Social welfare spending as a percentage of gross national product averages 21.8% in OECD countries, but we are a low-burden, low-welfare society with only 10.9%. Just to reach the OECD average, let alone match Nordic high-burden, high-welfare societies, we would need to increase taxes by a minimum of 200 trillion won annually (11% of 1,919 trillion won).

Taxes themselves help taxpayers when spent on security, order, and welfare, but distrust over waste creates aversion and resistance. If people are confident that taxes are being spent for their benefit, there is no reason to resist.

In a basic income-specific tax where funds are fully distributed and 90% of citizens receive more than they pay, tax resistance is not an issue. If basic income is provided through perishable local currency, it generates economic growth effects in addition to expanding welfare, and satisfies high-tax payers who capture most of the fruits of growth.

Starting with 20-50 million won per year and gradually increasing to an appropriate level (500,000 won per month) in stages (over 10-20 years) after welfare-economic effects and public consensus are verified through tax increases for funding, we can simultaneously achieve tax increases, welfare expansion, and economic revitalization.

2. Welfare replacement through basic income is not fact.

Basic income is implemented by creating new funding under public consensus (except for small pilot programs), so welfare replacement is unfounded. We should expand welfare that is only half of OECD levels, not reduce it through replacement.

3. The claim of basic income without tax increases (so-called peace of mind income) is fiction.

The claim of 'basic income without tax increases' is a juggling act of policy that replaces existing welfare and cannot gain public support, nor does it help advance welfare or revitalize the economy—it is an unfeasible claim.

4. Basic income does not conflict with universal employment insurance.

Both universal employment insurance, which is a short-term remedy for temporary unemployment on the premise of job retention, and basic income, which is a long-term fundamental solution for the Fourth Industrial Revolution era when jobs disappear, are necessary. These two are neither conflicting nor mutually exclusive.

While it is difficult to secure funding for universal employment insurance where taxpayers and beneficiaries are separated through tax increases, funding for basic income where taxpayers and beneficiaries coincide can be secured through tax increases.

5. How to spend secured funds and how to raise funds are different matters.

The argument that it is more efficient to support only some disadvantaged people rather than 'everyone' is correct when spending already-secured funds, but incorrect when creating new funding. This is because no taxpayer will willingly bear a new burden from which they receive no benefit.

While it is easy to collect 10,000 won proportional to ability from ten people to distribute 1,000 won each, it is not easy for five people to each pay 2,000 won to give 10,000 won to one disadvantaged person.

Basic income is a welfare-economic policy distributed to everyone, making it easier to implement tax increases; but tax increases for selective welfare or employment insurance benefiting only a few are not easy to implement.

6. We must be honest about the truth and trust in the collective intelligence of the people.

Those who turn away from raising funds due to tax resistance end up absorbed in selective distribution as a result of only thinking about 'where to spend available money.'

To advance welfare and revive a struggling economy, expansion of welfare and economic policies is necessary, and we must publicly acknowledge that tax increases for this purpose are inevitable.

We must trust the collective intelligence of the people—a body with 100 million eyes and ears and 50 million mouths—persuade that tax increases for effective welfare-economic policies benefit everyone, and we can certainly draw out that consent.